My Buyer Backed Out. What Happens If I’m Behind on My Mortgage?
A contract falling apart doesn’t touch the clock on your loan. If you’re behind and selling, you’re running two clocks at once, and only one of them stops when a buyer signs.
Cotality’s monthly market read, published September 24, has the number behind it. Almost one in eight contracts from June still hadn’t closed sixty days later, the highest share in five years. Closed sales were down 5 percent year over year in August. Pending contracts slipped again in both July and August.
The same report has the number that explains why most sellers never feel any of this. Average borrower equity hit $310,000 in the second quarter, and only 2 percent of mortgage borrowers are underwater. A 15 percent price drop would only push that share up by 5 points. For most people, a dead deal just means relisting and waiting for the next buyer.
Why Are So Many Contracts Falling Through Right Now?
Cotality doesn’t say. The report counts the contracts that haven’t closed, not the reasons behind them, and it doesn’t separate a buyer’s financing falling through from a bad inspection or a change of heart. What it does show is the size of the gap: 1.3 percentage points wider than the same measure a year ago, alongside sales that are down and pending contracts that are down too.
Why Does This Hit Harder If You’re Behind on Payments?
Because a contract doesn’t pause a foreclosure case, and it doesn’t pause a servicer’s clock either. If you’re several payments behind with a case already on the court’s docket, losing a buyer sixty days in means restarting the file with whatever time is actually left, not with a fresh sixty days.
Does It Get Worse on a Short Sale?
Yes, and it’s the part most sellers don’t find out until it happens. A short sale approval is built around one specific buyer’s contract and price. Lose that buyer and the file usually goes back to the servicer’s desk, and the next offer gets underwritten against whatever the market looks like by then, not the number that was already approved.
What Should I Actually Be Checking First?
Not what the house is worth. A written payoff from the servicer and a clear look at where the foreclosure case actually stands, if there is one. Those two numbers tell you how many days are actually left. A home value estimate off a website doesn’t.
In other news, Florida’s insurance commissioner approved four homeowners rate cuts this week.
Is My Homeowners Insurance Actually Going Down in Florida?
Only if your carrier is one of the ones that filed.
Commissioner Mike Yaworsky approved decreases at One Alliance North America (10.4 percent, 17,148 policies), Safe Harbor Insurance (4.1 percent, 10,501 policies), Unique Insurance (3.2 percent, 8,266 policies) and Vyrd Insurance (10.4 percent, 26,751 policies). Add those four together and it’s roughly 62,700 policies, against a state with millions of homeowners policies in force.
The Florida Office of Insurance Regulation’s own numbers show where the wider trend sits. The 30-day average rate request is now 4.8 percent down, against 1.1 percent down the same time last year. Since January 2024, 48 companies have filed for decreases and 53 have asked for no change at all. Yaworsky’s own words: the office is getting rate decrease requests “ranging from -0.3% to -19.7%.”
Why Might My Payment Still Go Up Even if My Rate Goes Down?
Because a filed rate change is an average across a company’s whole book. A specific house can move differently depending on its county, its roof and its coverage. And insurance is only one line in an escrow payment. Property taxes sit in there too, along with whatever shortfall the last analysis found, so the total can still climb in the same year the insurance line drops. If your payment jumped and you’re behind because of it, the escrow analysis is what to read, not the press release.
Jacksonville, Florida is my market, and distressed property is most of what crosses my desk. Happy to walk through where either of these actually lands for you.
JimArmstrong904@gmail.com, or (904) 671-4161 if a call is easier.
Jim Armstrong, REALTOR, Momentum Realty. SFR (Short Sales and Foreclosure Resource) certified. This is general information, not legal, tax, or financial advice.
Momentum Realty is not associated with the government, and our service is not approved by the government or your lender.
